Question: A. The chart above shows data for Charisma Ltd. i. Label the lines (2 marks) ii. State the breakeven revenue and units (2 marks) iii.

 A. The chart above shows data for Charisma Ltd. i. Label

A. The chart above shows data for Charisma Ltd. i. Label the lines (2 marks) ii. State the breakeven revenue and units (2 marks) iii. What is the profit/loss and margin of safety if the firm earns revenues of $800,000? (2 marks) iv. What is the contribution margin if the firm produces 1,200 units? (2 mark Semester 1 2022-2023 B. ABC Ltd. Manufactures cooking pots. The company's best selling pot Sells for $250. The variable costs amount to $160 per pot. The results for the last year were: i. Compute the numbers of pots the firm must sell to break even (3 mal ii. The company is considering a change in its production process. The new process would reduce variable cost per pot by 20%, but fixed costs would increase by $250,000. Prepare a contribution statement assuming the new process is implemented, the firm continues to sell the same number of pots and selling price remains constant. (6 marks) iii. Should the company introduce the new production process? Justify yourresponse.(Total20marks)(3marks) (Total 20 marks) A. The chart above shows data for Charisma Ltd. i. Label the lines (2 marks) ii. State the breakeven revenue and units (2 marks) iii. What is the profit/loss and margin of safety if the firm earns revenues of $800,000? (2 marks) iv. What is the contribution margin if the firm produces 1,200 units? (2 mark Semester 1 2022-2023 B. ABC Ltd. Manufactures cooking pots. The company's best selling pot Sells for $250. The variable costs amount to $160 per pot. The results for the last year were: i. Compute the numbers of pots the firm must sell to break even (3 mal ii. The company is considering a change in its production process. The new process would reduce variable cost per pot by 20%, but fixed costs would increase by $250,000. Prepare a contribution statement assuming the new process is implemented, the firm continues to sell the same number of pots and selling price remains constant. (6 marks) iii. Should the company introduce the new production process? Justify yourresponse.(Total20marks)(3marks) (Total 20 marks)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!